ESTOPPEL AND THE LAND REGISTRATION ACT 2002

Extract

WISHART v Credit and Mercantile Plc [2015] EWCA Civ 655 is an unusual priorities case. At its heart is an informal business partnership between two close friends: S and W. Together, the pair undertook a series of property developments. In all their ventures, S took the lead on financial matters. With the approaching sale of a particularly lucrative development, S and W considered how to spend their gains. W indicated that he would like to purchase a residential property for himself and his family, and entrusted the arrangements for the acquisition to S. W removed himself entirely from the process, failing even to look at the contract of sale. As such, he did not realise that S had inserted himself as the purchaser of the property. Upon sale, W and his family moved into the property, oblivious to the subterfuge. S then secured a loan of £500,000 on the property by way of a legal mortgage in favour of C&M. The sum was promptly gambled away, and S, now declared bankrupt, disappeared. C&M obtained possession of the property and sold it for £1.1 million, using just under £700,000 of the proceeds to recoup their loan and expenses. It was at this point that W re-entered the narrative, appearing before the court to argue that, by virtue of an overriding interest, he was entitled to the proceeds of the sale over C&M.